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A large, vaccine-skeptic population could be a boon for Pfizer’s Paxlovid.
Courtesy of Pfizer
America’s drugmakers played key roles in developing Covid-19 vaccines, but the country ranks well below 50th on the percentage of its population that is fully vaccinated.
The good news is that our friends who’ve been Joe Roganning their way through the pandemic can now put down the horse paste and buy pills that work.
In trials,
Pfizer
‘s Paxlovid significantly reduced the chances of Covid-infected patients being hospitalized or dying, says the Food and Drug Administration, which has granted an emergency use authorization.
Why would patients who’ve shunned a vaccine embrace an antiviral? I don’t know, but at one point last year many of them lined up for miles to take a safe and tested monoclonal antibody that was developed using genetically altered mice, so I think they’re open-minded, in their own way, at least after contracting the virus.
Anyhow, a rich country with a large, vaccine-skeptic population could be a boon for Pfizer’s (ticker: PFE) new pill.
J.P. Morgan
reckons the company’s earnings per share will double this year to $8.57, before dropping to $5.74 next year. That will be driven partly by Paxlovid sales, estimated at $33 billion this year and $17 billion next year. The Street is well below those numbers, predicting earnings of $6.55 this year. So either JPM has got it wrong or Pfizer is headed for a string of upside surprises.
The bank only rates Pfizer shares at Neutral, however, saying that more progress on its pipeline of new medicines is needed. It recently added
Vertex Pharmaceuticals
(VRTX) to its Focus List, citing an attractive growth profile and an opportunity to diversify away from cystic fibrosis.
Leg Up From Shiba Inu
Last week I wrote that
Bitcoin
doesn’t become a better deal when the price falls, because the price is based only on enthusiasm. It’s up a smidgen since then, so please take turns dunking on me and telling me to “do the research, Boomer.” I’m technically part of something called Generation X, but I’m coming to terms with the fact that a) no one cares, and b) to young investors, all of us olds look alike.
Coinbase
Global (COIN) should be something everyone can agree on. It generates healthy free cash flow while dealing in crypto and non-fungible tokens, and enabling yield farming and other decentralized-finance pursuits. It all looks to me like an elaborate role-playing game, minus the wizard spells and dice, plus gambling, but maybe I’ll be proven wrong, and meanwhile, how about Coinbase shares in light of all that free cash?
They opened at $328 a share in a direct listing last April, and recently traded below $190. That puts the company’s market value at close to $41 billion. Free cash flow ballooned to an estimated $3.7 billion last year—the company is expected to report fourth-quarter results in mid-February. But its free cash flow is seen falling by half this year, and declining again next year. Individual estimates within the consensus are, as you might imagine, all over the place. The stock is intriguing, but its future depends of course on whether interest in crypto builds or one day collapses, and I don’t seem to be good at predicting interest in virtual assets—digital cartoon apes took me by surprise.
I’ll tell you who likes the stock. On Tuesday, Needham reiterated both its Buy rating and price target of $420—implying a one-year double, and then some. In a report, the firm predicted that Coinbase’s trading volume will be at or near a record high for the fourth quarter. And that’s owed partly to something called
You don’t hear much about Shiba at the moment. It’s a parody crypto of a parody crypto, and securitized jokes seem to have cooled off. Also, it trades at a tiny fraction of a penny. But last year’s percentage gain was enough to turn $1,000 into $438 million. I’m sitting here in the stock market talking about cash flows like a not-quite-Boomer, when I could be throwing yacht parties and building randy-looking rockets like Bezos.
Shiba went nuts last October, especially, and Coinbase at the time had one of the few apps offering U.S. pairs trading between Shiba and other cryptos, Needham points out. It recently raised its fourth-quarter revenue estimate for Coinbase from $1.73 billion all the way to $2.14 billion, and its earnings per share estimate from $1.76 to $2.51. Both numbers are well above the Street, so if Needham is right, Coinbase’s results could be well-received.
The firm left its 2022 estimates unchanged, however, noting that “euphoric bull runs” can be followed by “crypto winters.” It isn’t declaring one of those, but given recent weakness in the asset class, it says the odds have increased.
Write to jack.hough@barrons.com